How companies are started, scaled and sometimes lost, in the founders’ own words.
A compelling story is a claim to test, and the test for a technology is watching it work.
Venture and growth diligence, and any investment where the case rests on a founder's account of something that cannot yet be seen.
From The Inventor: Out for Blood in Silicon Valley · 2019
Judge an adjustment by whether an owner of the whole business would also get to ignore the cost.
Reading any earnings release, pitch deck or S-1 that leads with a non-GAAP measure.
From WeWork: Or the Making and Breaking of a $47 Billion Unicorn · 2021
Evidence about demand comes from what people have already done and paid for, not from what they say they would do.
Customer discovery, commercial due diligence, and any interview that asks how you would validate a product idea.
From The Mom Test · Rob Fitzpatrick
A platform that lets others earn on it grows faster than one that captures every dollar; the forgone revenue is the investment.
Platform strategy, take-rate questions, and any marketplace where the company could raise its share of the transaction.
From Shopify's 2015 IPO letter from Tobi Lütke · Tobi Lütke
Tell investors in advance that you will optimise long-term cash flows over reported earnings, then do it, so the market can price the choice rather than be surprised by it.
Any growth company valuation, any founder letter, and the interview question of how to value a company that reports no profit.
From Amazon's 1997 letter to shareholders · Jeff Bezos
Profit is not cash, and growth widens the gap; model the cash a business needs to grow before admiring its sales.
Any three-statement question, any growth company's cash flow, and any founder conversation about runway.
From Shoe Dog · Phil Knight
Judge a network by whether its first small market is dense and self-sustaining, not by the size of the market it aims at.
Early-stage diligence, growth strategy questions, and any marketplace that reports total users rather than density.
From The Cold Start Problem · Andrew Chen
A founder-controlled company should say what control is for and what investors give up; the 2004 letter is the template for saying it plainly.
IPO process questions, governance debates about dual-class shares, and any founder letter that cites this one.
From Google's 2004 IPO founders' letter, "An Owner's Manual" · Larry Page and Sergey Brin
Protecting a secret and refusing to demonstrate a result are different things; a company that cannot tell them apart may have no result.
Technology diligence, and any situation where access to evidence is being refused on grounds of confidentiality.
From Bad Blood · John Carreyrou
Being distinctive is not a state but a cost paid continuously; stop paying it and the drift to typical begins.
Questions about culture, moats that depend on behaviour rather than assets, and personal career choices.
From Amazon's 2020 letter to shareowners, Jeff Bezos's last as chief executive · Jeff Bezos
When every option is bad, the cost is in the delay; choose the least bad one and move.
Assessing a management team under stress, and any interview question about a difficult decision you made.
From The Hard Thing About Hard Things · Ben Horowitz
Growth is arriving faster and concentrating harder, so a company's trajectory in its first year tells you more than it used to.
Venture and growth diligence, cohort analysis, and any question about base rates for new companies.
From Stripe's 2025 annual letter · Patrick Collison and John Collison